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Be Wary of Coronavirus Scams Be Wary of Coronavirus Scams

Be Wary of Coronavirus Scams

As if the coronavirus pandemic is not enough to worry about, businesses, investors, and others now have to be on the lookout for virus-related scams. Cybercriminals and other fraudsters have seized upon the global crisis by exploiting fears about the virus and COVID-19, the respiratory illness it causes. As the reach of the coronavirus has increased, so have the methods by which wrongdoers are seeking to defraud the unwary.

Clients should watch for phishing attempts in which a scammer sends an email that appears to be from a legitimate—and often well-recognized—source. The message might look like it is from a medical insurance company or government health organization, such as the Centers for Disease Control directing the recipient to enter sensitive information like account numbers, passwords, dates of birth, or social security numbers with the supposed goal of providing important information about the outbreak. Other phishing efforts include emails with an attachment the recipient is directed to open for additional information. When the attachment is opened, malware infects the recipient’s computer system. The emails appeared to have been sent by the World Health Organization. These sorts of spoofing attempts could also arrive by way of a text message or telephone call.

Other types of scams involve solicitations from organizations purporting to provide charitable relief to victims of the coronavirus and crowdfunding sites claiming to raise money for such relief efforts. Well-meaning victims are conned into sending money to the fake charities that is never used for the stated purpose. So-called non-delivery schemes dupe victims into buying equipment or medication that supposedly will protect against infection. The products, however, never arrive. The promoters of these scams often use vehicles such as online forums and Facebook to find and dupe anxious victims. In another scheme, businesses peddle products like oils, teas, and minerals they claim will prevent, detect, or cure the disease in violation of laws requiring such products to be approved by the Federal Drug Administration. The FDA and Federal Trade Commission jointly have taken initial steps to curb marketing efforts by several sellers of these types of unauthorized remedies.

Similarly, scams touting investments in companies that offer such bogus products are on the rise. Promoters solicit investor funds by claiming the stock price of the target companies will sharply increase on the strength of their sales of these products. Microcap stocks, low-priced shares offered by small companies about which there is scant publicly-available information, are common vehicles for these types of fraudulent solicitations.

Clients who have been victimized by coronavirus-related scams should report the conduct to the appropriate law enforcement or regulatory agency. If it is not clear where a referral should be made, seek assistance from counsel who can provide guidance on where to go and how to preserve and produce evidence relating to the offense.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.
 
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